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Quest Means Business
Will Air Travel Over Europe Resume Tonight?; Goldman Sachs Case
Aired April 20, 2010 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST, QUEST MEANS BUSINESS: Let the flying begin; passengers arriving at airports all around the world. Now there is a realistic chance they'll get back to Europe. But it's a lottery as the volcano continues to spew ash.
There is a cloud over Goldman Sachs tonight. Did they do enough to defend their reputation?
And talking of reputation, James Bond is in trouble. Is the name about to be repossessed?
I'm Richard Quest, live tonight from Newark Airport, where I mean business.
Good evening to you. Welcome to Newark Terminal B where thousands of passengers are arriving. They are here because there is a good chance tonight many of them will get back to Europe, except, of course, for those whose aircraft are still not here.
For instance, British Airways still has flights cancelled to London Heathrow. Lufthansa who will be hearing from in just a moment is hoping to get passengers back to Frankfurt. There have been some angry scenes over the past few hours. These passengers are waiting for a Jet Airways flight. It is going supposedly to Brussels, but for the past five days Jet has been flying via Athens. And these passengers have been waiting some four days. The police had to be called at one particular point, when voices were raised. Thankfully there were no more ugly skirmishes.
In the course of the next 10 minutes we'll bring you up to date on exactly what the situation is and who is expected to fly where. We need to start, though, in what is rapidly becoming the epicenter besides the volcano. It is London in the United Kingdom, where the airports remain closed and where CNN's Paula Newton has got more facts, flying doesn't look likely to start anytime soon, Paula.
PAULA NEWTON, CNN INT'L. CORRESPONDENT: Let's deal with what we know and the facts. This airspace remains closed. Behind me Heathrow Airport and all of those other crucial hubs, Richard, through London, will remain closed until at least 1:00 o'clock in the morning, British Standard Time.
In Scotland, some glimmer of hope there. Those airports will open about now, you should start to see a window of opportunity, but those very crucial long-haul flights remain grounded for British Airways and other British carriers. Having said that, behind the scenes today, Richard, a lot of work going on between the government regulators, the government, and especially British Airways and some other British carriers who have been pushing hard, putting more test flights in the air and trying to prove to the aviation authorities that it is safe to fly.
Right now there is speculation that perhaps later on this evening, there could be some action here behind me at Heathrow. We are unable to confirm that with anybody right now. But we'll continue to keep an eye on it. The problem, Richard, is still that stubborn cloud that continually has gotten enmeshed in this northeast wind that keeps that ash over Britain. It has been infuriating today, Richard, if you sit here you can actually see those over flights. It has been Lufthansa, American Airlines, right over our heads, right over Heathrow. And yet, right here we remain grounded, Richard.
QUEST: Paula, the costs for the U.K. airlines are now starting to mount into serious numbers, if there is any group of carriers that will have strong call for financial help, it would be BA, BMI, Virgin, and EasyJet and the like.
NEWTON: They are putting a lot of pressure on both the government here in Britain and on Europe to come up with some cash, Richard. Because when all this is over, and we don't even know when it is going to end. People are talking about a British aviation industry that will be crippled and with some air carriers really teetering on the point of bankruptcy.
That is what they are saying and this is very important for travelers as well, Richard, because depending on what they hear from those governments, that is going to be proportional to the number of receipts that they can hand in to these airlines and the kind of expenses that they can get reimbursed. Right now, as we speak, hotels, food, taxi rides, you name it, people are going to start to try and claim it, if they haven't already done so. And as you said, the losses continue to mount. Still no word on whether there will be compensation.
QUEST: The big question, of course-thank you, Paula. Paula Newton at Heathrow Airport doing duty for us there.
The strategy of who pays is for another day. For passengers across the world it is really getting on a plane. The German airline Lufthansa is carrying out a test flight. And A34600 is going up to assess the volcanic cloud and ash over Europe. That, of course, would enable Lufthansa and others to offer more flights. Having brought 50 services into Frankfurt and Germany last night, Lufthansa is running several 100 services today. Joining me now, Dieter Grosse, the Lufthansa station manager, at Newark.
Good afternoon to you.
DIETER GROSSE, STATION MANAGER, LUFTHANSA, NEWARK: Good afternoon.
QUEST: So, you have got-your check in desk is over there. How are you getting-are you expecting to get passengers out? What is the position tonight?
GROSSE: The position tonight is we are operating one flight to Frankfurt, and one flight to Munich, out of Newark. But we are operating approximately 30 flights out of the U.S. today.
QUEST: So that is pretty near a normal service back to Germany?
GROSSE: Yes, that is correct.
QUEST: Who-the question everybody really wants to know, is who gets on those planes? Who are the passengers that manage to?
GROSSE: Well, number one, the passengers that had a confirmed booking for today's flight. And then passengers who have been staying here since last Thursday, when they actually the disaster happened.
QUEST: And as you try and negotiate that, those passengers, some passengers will take several days, if not up to a week, before some will go back. There is no other way around that, is there?
GROSSE: This could actually happen yes. We do rebook passengers on the first available flight, that is the confirmation they have, but they also could come to the airport to get on the waiting list here at the airport.
QUEST: Realistically-and I'm not trying to pin you down onto the spot. But realistically, if you have a booking, you know a confirmed booking at the beginning of May or something, is it more realistic that you are actually going to get out of here before then?
GROSSE: There is a good chance to get on one of our flights, here, definitely. Because a lot of passengers who had a confirmed booking will not show up for their confirmed flight. Because they have, in the meantime, they have taken different plans. So, they will not-that means these seats will remain open.
QUEST: But things are getting better, is the message, I think, tonight?
GROSSE: Yes, absolutely, yes. We are very optimistic.
QUEST: Many thanks, indeed. Good luck in getting your passengers-and you and I will check in again as the week moves on. Many thanks, indeed.
GROSSE: Thank you.
QUEST: Now, as we consider to look at all implications on this, let's talk to IATA, the International Air Travel Association-Transport Association. Steve Lott joins me now from IARTA, the Washington representative.
Steve, we know-and hey, we have just heard from Dieter, things are getting better. Slowly, but surely, from the passengers point of view, but from the airlines point of view, you still believe that more airspace should be opened up and more flying should take place?
STEVE LOTT, HEAD OF COMMUNICATION, IATA: Well, we think there should be more testing, Richard. It is really as our Director General Giovanni Bisignani said yesterday, is that we didn't see much coordination. Why did it take five days for the European transport ministers to come to the table and talk about this? The airlines as you mentioned, for the past few days have been doing some test flights to try to determine the quality. Obviously, if the ash cloud is too thick, we don't want to send aircraft in harm's way. But if there are some corridors that are clear, let's get those flights in the air.
QUEST: And the compensation question. Is it justified that airlines should be compensated by European governments for this? I suppose the argument goes, it is not their fault, they should get the money. But then, perhaps they should have been insured against this sort of mass disruption?
LOTT: Good questions and these are difficult questions to answer. We are going to be talking about that very issue in the days to come. Giovanni will be in Brussels at the end of the week to discuss this issue, but there is a precedent. We look back to what happened after the 9/11 tragedy here in the U.S. And the U.S. government paid upwards of $15 billion in relief help to many of the airlines in the U.S. and elsewhere.
So there is a precedent in this type of global catastrophe. When the insurance question is a tough one because obviously, insurers don't insure against act of God, or Mother Nature, Force Majeure, as they say. The similar would be a hurricane or a big blizzard or snowstorm. So, many insurance policies wouldn't cover against that.
QUEST: Now, what a lot of people-and I put myself in this category- find difficult to understand, Steve, is on the one hand, the airlines say they want to fly safely, obviously, but they believe that more air space and more flying can take place. On the other hand the regulators say, they want to fly safely and that is the way it is. So, who is being-who is practicing safe flying?
LOTT: Absolutely. And it is a difficult balance, as you said. I mean, I don't think any airline wants to put their aircraft and their crews and their passengers in harm's way. But I think our message is lets base our decision, lets make risk-based decisions based on actual data, not just on theory or satellite pictures, or theoretical maps. Let's base it on data. If the data shows that it is not safe, we're not going to fly. But I think we need to do more testing and we need to have better coordination between the various European governments and the air traffic control authorities.
QUEST: All right. We thank you very much there, Steve, joining us on the line from Washington.
And let me put this, before we just go to these, Adrian, this is a reservation that I have just been handed by somebody, covering the name. This is for a passenger who was supposed to fly back, was supposed to fly back on Sunday. Obviously, the flight was canceled, they'll probably leave sooner, but they are confirmed seat is back on the first of May. If I'm not mistaken, we are the 20th of April, at the moment.
All right. We'll talk more about these sort of people, and we'll talk to some of these people behind us where there have been some rowdy scenes at Newark Airport, as passengers, frustrated, understandably.
Adrian Finighan, though, is at the CNN News Desk to bring us up to date with the world news.
(NEWSBREAK)
QUEST: We thank you very much Adrian Finighan at the CNN News Desk (AUDIO GAP)
ADRIAN FINEGHAN, CNN ANCHOR, NEWS DESK: Well, hello again. Richard will be back with us, in just a few moments, live from Newark Airport, in New York, or just outside New York. Stay with us on QUEST MEANS BUSINESS, we're back in a second.
(COMMERCIAL BREAK)
QUEST: Welcome back to QUEST MEANS BUSINESS. We're live at Newark Airport, where passengers by the 10s of 1,000s are now starting to check in for flights back to Europe. We'll have more on that story in just a few moments.
The other big story we are following this time in the financial world, concerns Goldman Sachs facing SEC charges that it misled investors. Goldman had superb earnings results but also came out with a robust of a defense of its position against the SEC claim. Maggie Lake is in New York.
And Maggie, I think that is a fair assessment?
MAGGIE LAKE, CNN INT'L. CORRESPONDENT: Yes, absolutely, Richard. And let's start with those earnings because they topped even the most optimistic estimates out there. Goldman Sachs earning $3.5 billion in the first quarter, that is almost double the same period, just one year ago. The strength came from trading and also slightly scaled back compensation. That fueled the results. CEO Lloyd Blankfein said, "Our performance in the first quarter reflects more signs of growth across the economy. That is a positive for everyone, as well as strength for our client franchise.
Now, normally, that would be cause to celebrate, but of course these are not normal times for Goldman Sachs. In back-to-back conference calls that lasted the whole length of the morning, they feel that calls from both investors and then members of the press, almost all of them dominated by questions about the SEC suit against them, as well as looming financial regulations.
Greg Palm, one of the firm's top lawyers made a vigorous defense of Goldman's actions, saying at one point, quote, "This all seems to be at root, whether someone intentionally mislead someone else. And that is not something we would approve of or sanction. I have to say, we were both listening to it, he had to say that over and over again, as the questions continued to pour in. Most of them legal in nature, not financial.
Now, in a sign of just how seriously Goldman is taking this case, they have reached into Washington's inner circle and hired, who other than, President Barack Obama's former top lawyer, former White House counsel, Gregory Craig, to help in their defense. So, you know it is really sort of going to be a battle here.
One thing I want to point out, Goldman stock was rallying in the beginning of the day, it has given back gains, it is actually down about 1.5 percent, so far on the day, Richard.
QUEST: Maggie, when we look at the Goldman Sachs question, we now sort of-I mean, somebody very well put it to me, when we heard the SEC's story, they said it was like hearing the wife or the husband's side in a divorce case. You had to hear both sides. We are now starting to hear the other side, and then suddenly it doesn't seem as clear cut as it might have done to start with.
LAKE: Certainly not. Certainly not. This is going to be a difficult case for the government. It involves very complicated, as you and I were discussing earlier, very complicated issues, nuances of the law, when it comes to the securities area, but here is the situation for investors. Even if long term you feel positive about Goldman Sachs, there is now uncertainty. And it is hard to value stocks when you don't know what is going to happen, how wide the SEC probe is going to get.
And also remember, the financial reform that is now sort of has new life breathed into it, here in the States and to that extent whether that is globally coordinated. That makes it very, very difficult for investors to figure out how to gauge these financial stocks. And that is what I'm hearing a lot of from money managers, that uncertainty is now back in the markets and there is a sense of paralysis a little bit. So, you are seeing volatility in the stocks, Richard.
QUEST: Maggie Lake, in New York. Many thanks.
Now, one of the analysts and experts on the Goldman conference call was David Trone. He is head of commercial and investment bank research at Macquarie Securities.
David, I heard your question to the management. You were fairly forthright, but do you think that their defense-we're not necessarily taking sides-do you think that they did what they had to do and did it to a satisfactory extent today?
DAVID TRONE, MACQUARIE SECURITIES: Well, I don't have all the facts yet. Based on what I've learned so far I'm increasingly believing that Goldman will get off and will be exonerated. I increasingly see holes in the SEC's case, but it really comes down to one simple thing, for me, did ACA know when Paulson was recommending securities, RMBS, did they know that they were the short on this transaction?
QUEST: And to that extent Goldman, today, was fairly blunt about these accusations, didn't they? They said, for instance, that they would have known that they see that any investors in these securities would have known that there was a short on the other end of the long, and that these were all extremely experienced investors. These were not, if you like, widows and orphans.
TRONE: That is absolutely right. I think a lot of people have, you know, tried to extrapolate this into, you know, Goldman, you know, harming a lot of investors. It is too very sophisticated institutional investors. They definitely knew because this was synthetic, that there was someone shorting. And since there was only Paulson in the room, they had to have, certainly suspected that they were the short. In fact, if I had to hazard a guess, I would say they knew full well that Paulson was the short, and therefore Goldman didn't do anything wrong at all.
QUEST: Right, but let's just take it away from the minutia of the actual case.
TRONE: Yes, yes.
QUEST: David, do you believe that there is-at the moment anyway-that there is any long standing reputational damage affecting Goldman. Not just from this, but from the Greek bonds issues, from the questions of Lehman Brothers and its role there, from AIG. It seems to some that there is a Goldman angle in all of these matters.
TRONE: Well, you know, I don't know that-I would never characterize Goldman as an angelic organization the way that management would like to believe, but you know they are an institutional firm. They are not dealing with Mom & Pops at all. So, institutional investors deal with Goldman and I talk to them all the time. They know to watch their back when they are, you know, involved with Goldman, because Goldman is savvy and, you know, really good at what they do. And so, in terms of reputational damage I think people are already pretty eyes wide open when they deal with Goldman as an institution. So, I don't know that it is necessarily going to have a huge impact on their business.
QUEST: David, it is lovely to have you on the program and to make such sense of these difficult matters. We thank you indeed, for that.
Now, Goldman's strong results that we also talked about, gave a boost to European markets after two days of sharp losses. Take a look at the numbers. All the major markets rebounded quite nicely. Banks lead the way in London, with RBS closing more than 4 percent higher. Ironic, since RBS paid out by ABN Amro on the Abacus deal.
But carmakers were the best performers. Daimler raised its 2010 outlook for its Mercedes Benz unit. Daimler up more than 7 percent. BMW, Renault, Peugeot weren't far behind. The Zoo index also was sharper.
Now when we come back, in just a moment, we will not only consider the question of the British general election, and the banking community, and how that affects. But take a look, it is Russia, now here, at Newark International Airport. The planes are flying, the passengers are arriving, but who will get on the plane?
(COMMERCIAL BREAK)
QUEST: Welcome back. QUEST MEANS BUSINESS, we're live at Newark Airport. We all can look at the aviation crisis in just a moment. Another major story that we're following, Gordon Brown, has used election campaign visits to a BMW factory in Oxford, to spell out what would be a labor government or renewed labor government policy on industrial economics.
The British prime minister told autoworkers the car industry had battled through the recession and that he was quote, fighting for the future of the economy. He also said Labour would back research and advanced manufacturing. The election is being fought on a number of different economic platforms. Prime Minister Browns government is defending the move to increase taxes on various banks. Not only on bonuses, but also to create the so-called bankers levy or bank levy that will pay for those that failed.
All three main parties say they want a specific levy on banks to protect against future disasters. Some financial institutions have basically said such a levy is a disaster. They'll take their business elsewhere. In Europe, that would mean going to Frankfurt, which is the other major financial capital. Fred Pleitgen reports from the German financial center.
(BEGIN VIDEOTAPE)
FREDERIK PLEITGEN, CNN INT'L. CORRESPONDENT (voice over): The towers in Frankfurt's financial district stood solid throughout the financial crisis and now the city, the DAX as well as Germany's banking industry have seen a very solid return to profits.
One of the big differences between Frankfurt and London is while the banks in London rely very heavily on high risk banking, German banks relied more on traditional banking, things like lending to small and medium-sized companies, business that wasn't as affected by the meltdown of the international financial markets.
Now one thing that experts say is that they believe if Germany stays as solid as it is right now, and that is the way it is looking, it could attract business that has been in London so far here to Frankfurt.
There is not much of a problem to understand that high-tech investment banking activities has been scaled back. And that has the implication that the location where this was concentrated, London, and looses in importance, in relative terms, and Frankfurt is more concerned with traditional banking and therefore it gains.
PLEITGEN: But one thing that experts here in Frankfurt concede is that they believe that Frankfurt will never be as big a financial market place as London, or New York, or even Hong Kong. They say that it will always be somewhat of the second tier of financial markets. However, they do say that Frankfurt does have a lot to offer companies and individuals who come here. There is a very nice environment. The city is very nice the infrastructure is very good and they say that is something that banks and other industries are also looking at. Fred Pleitgen, CNN, Frankfurt, Germany.
(END VIDEOTAPE)
QUEST: Stay with CNN for coverage of the campaign in Britain. Right up to the election itself on May the 6th. The three main leaders this week head into the second of three debates. This one is on foreign policy. CNN will bring it to you live Thursday at 2000 in London, a special edition of "CONNECT THE WORLD" with Becky Anderson.
Now, we are talking about the problems of people having to get back home to Europe.
Let's meet Valerie. Valerie where are you trying to get to?
UNIDENTIFIED FEMALE: We are trying to get to Brussels. I want to go back there because I have been stranded here since last Saturday. And my children are at home. They are looked after with my relatives, and I'm here with my husband and I have to go back to work.
QUEST: So, you have been stranded for-let's put this in perspective. You have been stranded for four or five days now.
UNIDENTIFIED FEMALE: Yes.
QUEST: And the airline that you are flying with, which is Jet Airways, is flying via Athens, not via Brussels at the moment?
UNIDENTIFIED FEMALE: Yes, that is what they are proposing us, to go to Athens, so that is what we are going to do today. We are going to go to Athens and the we are going to rent a car to go back to Brussels.
QUEST: So, is the object just to get across the Atlantic, however you can?
UNIDENTIFIED FEMALE: Yes, because they are always talking about the ashes and the volcano going again. So, we are not sure we can leave afterwards.
QUEST: How are you feeling? How are you holding up?
UNIDENTIFIED FEMALE: Uh, I'm-I'm near a nervous breakdown now. I feel very, very sorry, very sad. And I want to see my children.
(SOBBING)
QUEST: Well, have a good-get home tonight.
UNIDENTIFIED FEMALE: Yes, I hope.
QUEST: You'll get home tonight. Many thanks indeed. All right.
When we come back in just a moment, this is the real face of the crisis, but we are gong to look at the economic face as well. From car parts to flowers the products that aren't traveling. In just a moment.
(COMMERCIAL BREAK)
QUEST: It is easy to forget. Good evening, I'm Richard Quest. QUEST MEANS BUSINESS, this is CNN.
We are live tonight at Newark International Airport, where, as I was saying, it is easy to forget just the size and scale of the current crisis affecting large parts of Europe and the rest of industry as a result of this aviation crisis. For instance, the passengers may be one side of it, but we talk about all the companies that are not getting their products from A to B or perhaps their products are not needed at the moment?
For instance, airline catering companies who don't have any planes upon which to put meals?
Jim Bittermann now in Paris on the wider economic issues and the companies who are affected you might not expect.
(BEGIN VIDEOTAPE)
JIM BITTERMANN, CNN CORRESPONDENT (voice-over): For many of the past five days, the kitchens of Servair looked something like this. With airplanes grounded, the world's third largest airline caterer told its Paris staff to stay home. And no one could be certain when they were going to work again.
But late Monday night, managers were frantically trying to get at least some of them back to the kitchens, because with only 12 hours notice, Air France, Servair's parent company and biggest client, announced it was flying its normal long haul schedule Tuesday and wanted 95 percent of its normal order of flight food -- good news for the company, but like everywhere in the aviation industry these days, nothing is certain.
All that is sure is that the company, which normally prepares about 120,000 meals a day in Paris, was suffering what its local manager only could describe as substantial losses every day planes stayed on the ground.
ANDREAS BERMANN, SERVAIR PARIS: Never have we seen before that the industry was stopped for such a long period. Five days is a tremendous -- it will put a tremendous strain on all the -- all the partners in the industry.
BITTERMANN: While planes were once again taking to the air in Paris, at least for the long haul destinations like Africa, the Americas and Asia, there was still uncertainty everywhere. Uncertainty, for example, over which flights, in fact, were actually flying.
KERY YUN: If I can take a seat on (INAUDIBLE), I think that I'd better take the flight (INAUDIBLE), right?
BITTERMANN: And there was uncertainty, too, over who would actually get the seats which have now become available?
YUN: I'm not sure I can get a seat on that flight right now. I don't know.
BITTERMANN: And last but not least, with all the talk about what volcano ash can do to jet engines, there was uncertainty about whether or not planes really should be flying.
UNIDENTIFIED FEMALE: Don't ask him that.
UNIDENTIFIED MALE: No. Not at all.
BITTERMANN (on camera): What is -- how are you feeling?
UNIDENTIFIED MALE: Nervous.
UNIDENTIFIED FEMALE: That's the champagne.
UNIDENTIFIED MALE: Yes. No, I'm a little concerned, definitely.
BITTERMANN (voice-over): But you could tell from the lines, today fear was not really an issue.
UNIDENTIFIED MALE: I'm an engineer. I think the arguments are sound. But, of course, I have no firsthand knowledge. I need to keep moving here, sorry.
BITTERMANN (on camera): If passengers did have concerns about their safety, they were putting them aside for two reasons -- the need to get to wherever they were going and the idea that as bad as things have been over the last couple of days, with the volcano still erupting, they could get worse -- that this is the time to go.
(voice-over): And thousands who had the chance in Paris did just that. And if those up in the sky still were having doubts about their safety, at least they also had food for thought.
Jim Bittermann, CNN, Paris.
(END VIDEO TAPE)
QUEST: Now, of course, people are making whatever plans they can and showing as much ingenuity as possible. With the U.K. being the worst affected at the moment, the English Channel is perhaps bigger and harder to cross than 32 miles might suggest. Eurostar is full and ferries are doing brisk, brisk business.
Ayesha Durgahee is in Calais tonight, where she brings us up to date with whether the ferries are full and whether there's still room for more.
AYESHA DURGAHEE, CNN CORRESPONDENT: Richard, well, the cues are getting longer and longer here at the ferry port in Calais, as more people arrive by coach and by car. This is the reality, that if stranded passengers are to get to their final destination, they can forget going by air and that their best bet is to go by sea instead.
(MUSIC)
DURGAHEE (voice-over): As the cues slowly snaked toward the ticket center doors, passengers brought their stories about how far they've traveled and how much they've paid.
UNIDENTIFIED MALE: If you had booked on the Internet, this space would be 30 quid -- or it has been. It's gone up here. Look at that. They've doubled the price to 65. I think that's making a bit of a meal out of a bonanza (INAUDIBLE), you know what I mean?
It's a bonanza already. They're doing quite well. And now they're doubling their cash.
I mean I -- I -- I would -- I would be too embarrassed to do that, wouldn't you?
DURGAHEE: So far, the two ferry companies operating here have each carried 15,000 passengers since last Thursday. They've been authorized to increase capacity by 10 percent, allowing an extra 220 people. And that means putting more staff on board.
VINCENT LAUNAY, SEA FRANCE: These days, we are dispatching on additional costs we have with the additional means we hired and the additional people with which we show and on board to give safety and service to the people.
DURGAHEE (on camera): So you have raised the prices?
LAUNAY: We have raised the -- the prices at a reasonable level to cover the additional costs.
DURGAHEE (voice-over): And it's not just the ferry tickets. Passengers traveling across Europe to Calais have been hit with high car rental charges.
UNIDENTIFIED MALE: It's 60 euro today, plus 800 euro surcharge to leave it in France rather than Spain. And so everyone else seems to be having the same experience, except for these guys from the Brazil, the Swedes. They were asked for 5,000 euros to take a car from Portugal to Sweden. I think there's some profiteering going on.
DURGAHEE: Car rental companies say the charge is normal for hiring in one country and dropping off in another.
(END VIDEO TAPE)
DURGAHEE: Well, Richard, 800 euros to drop off a car is a lot of money. But the car rental companies here that we've spoken to -- Hertz, Avis and Europcar have all stressed that they have not increased their prices and that this is the standard rate. And people have been shocked about how expensive it is, because they've never done this before. They've never had to hire a car last minute and drive across several countries to France and -- and -- and drop -- and leave it behind, as they run for the next ferry
But the car rental companies lie -- I'm sorry. The car rental charges, as well as the hotel night stay, the extra taxi fares and the -- the money that they're paying for the ferry, about -- it's all the last thing on their minds, where they're just focused on -- on getting home and -- and looking forward to the moment when they walk through the door and they can have a cup of tea.
QUEST: Ayesha Durgahee.
Many thanks, indeed, Ayesha, over in Calais.
Well, this is all about ingenuity -- finding different ways, especially if you're suddenly out of pocket.
Let's go to Dublin now, where two Mulligans (ph) have been finding some interesting ways of raising money. They've been busking (ph), hoping to find -- hoping to find people who are managing, if you like, to spend a penny or two to help them get on their way.
Good evening to you tonight.
Give us a sample of what you've been singing.
UNIDENTIFIED MALE: Stuff like this.
(MUSIC)
QUEST: All right, so it all sounds very good, that. I'm not sure whether they can still hear me. But I suspect that they will be raising quite a bit of money as they try and do some busking. Go on.
How -- how much money have you managed to raise so far by all your busking?
UNIDENTIFIED MALE: Two hundred and fifty pounds today.
QUEST: Two hundred and fifty pounds.
What are you going to do with that money?
UNIDENTIFIED MALE: Keep going, because we need to get home. Every -- every time we step out of pocket, you know, we just got crushed with our dollar. And so now we're just kind of stuck. We just need to make money for the plane fare. The plane fare originally is -- has now been jacked up to 820 pounds, which we don't have.
QUEST: Right. So -- so you're -- you are in that -- you don't have a confirmed seat. You're not on a wait list.
You've basically got to buy a ticket, that's the gist of it?
UNIDENTIFIED MALE: Yes. Expedia basically said they'd give us a refund, but then we would have to repurchase a ticket. And, you know, when you plan ahead, you can get a cheap ticket. But now that it's last minute, they're telling us those are the last minute prices. And it's just unfortunate that they would do that kind of stuff. But that's where we are.
QUEST: All right, well, play us out for just a bit more music and I might even throw $5 I there myself.
Good luck getting back, indeed.
Play us a bit more music and while we listen to it -- while we listen to that. A bit more music from Dublin.
UNIDENTIFIED MALE: Thanks so much.
QUEST: While we meet -- while we meet these people here, Sarah (ph) and Anders. Sarah and Anders.
Where are you trying to get to tonight, Sarah?
SARAH: To Sweden.
QUEST: You're trying to get to Sweden?
ANDERS: And we are trying to get to Sweden. We are on the fly to -- first to Belgium and then on to Sweden. (INAUDIBLE) get there India, which is -- yes, the flight is going from New York to Bombay. But they will not stop in Brussels. They will stop in Athens.
QUEST: So where -- so you're going to Athens tonight?
SARAH: Yes.
ANDERS: We think so, yes. We've never been there, so...
QUEST: Right.
How long have you how long have you been waiting now?
ANDERS: Oh, it's -- it's today. We had -- we were the lucky ones. We came in probably the last flight from Scandinavia on Thursday.
QUEST: Oh. So -- so tonight is meant to be your flight?
ANDERS: Yes.
QUEST: You're confirmed?
ANDERS: We are confirmed, yes. But we are confirmed to Athens and it's quite a distance from Sweden. And we don't know -- some people say...
QUEST: So, look...
ANDERS: -- some -- some say there is a bus going from Athens up to Brussels, which is a 48 hour bus trip. I don't know. I -- I...
QUEST: Are you prepared for a 48 hour bus trip?
SARAH: I don't know. I don't think so.
QUEST: Well, there we are. Good luck getting back in some shape or form.
ANDERS: Yes.
QUEST: At least these are the confirmed passengers. We found a passenger who is going to be confirmed on a flight tonight.
Good luck getting to Athens.
ANDERS: Yes. Thank you very much.
QUEST: Have a safe journey when you finally...
ANDERS: Yes.
QUEST: In fact, when the passengers finally get moving, things will actually, of course, ease up a bit. But there's still a long way to go.
When we come back in just a moment, the name's and I'm bankrupt.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Time to rest your feet, Agent Q. Step outside. A taxi will stop for you.
(END VIDEO CLIP)
QUEST: Why the next James movie isn't just a work of fiction and it's not being made because of bad debts.
In a moment, QUEST MEANS BUSINESS in New York.
(COMMERCIAL BREAK)
QUEST: The rush hour in Newark -- the planes getting ready to fly back. Some will not go to their original destinations. This Jet Airways flight is supposed to go to Brussels and then on to Mumbai. But...
UNIDENTIFIED MALE: You're laughing with us, yes?
QUEST: I -- this -- this flight is supposed to go to Brussels and then on to Mumbai. In actual fact, it will be going on to -- it will be going by Athens instead.
The James -- the latest James movie -- the latest James movie is clearly in deep financial trouble. The backers say they haven't got the money to make it, so is not going to take place. It's the 27th movie.
Brooke Anderson is in Los Angeles and joins me now to bring me up to date -- Brooke, what's happened?
BROOKE ANDERSON, CNN ENTERTAINMENT CORRESPONDENT: Hi there, Richard.
Well, 007 is on the brink of a disaster and needs a rescue. The -- it is the 27th film, but it's the 23rd film from Eon Productions. And Eon Productions has put the film on hold indefinitely because the studio behind it, MGM, simply can't afford it. And they announced the suspense today. Eon Productions released this statement: "Due to the continuing uncertainty surrounding the future of MGM and the failure to close the sale of the studio, we have suspended development on 23 indefinitely. We do not know when development will resume and do not have a date for the release of 23."
OK, 23 was to pick up where "Quantum of Solace" left off. It was set to star Daniel Craig, as well. But here's the hiccup -- and this is a really big hiccup. MGM has amassed an enormous, mind-blowing debt of $3.7 billion. Now, the studio has been up for sale for a reported $2 billion. And I said $3.7 billion is their debt. And they've been up for sale for a reported $2 billion.
But so far, the bids have not come close to that, so no takers. The lenders want a sale or they want the studio completely restructured in order to move forward.
And you may ask, why is MGM in such a fix right now?
Well, some Hollywood insiders say that MGM has just been slow to get into the 21st century. The "Hollywood Reporter's" Carl DiOrio says that MGM has never been a wholly integrated company as far as multiple distribution platforms, that he says MGM has been slow to the game and that hurt them, especially when there was such a steep decline in DVD sales.
So -- so, Richard, there -- there's the main problem that MGM has gotten itself into. But -- but to be honest, there are many studios, many companies probably just biding their time and thinking, OK, when it's our chance, we will snap up the franchise and move forward -- forward with that.
So -- so it's not a question of if this movie will get made but when and with what studio and what will happen to MGM in the future?
Will it completely fold?
QUEST: Brooke Anderson, who is in Los Angeles tonight.
Now, we have talked a great deal about the flights that will be leaving from here and heading toward Europe. But Britain, of course, remains strangely quiet -- so Guillermo, at the World Weather Center in Atlanta, why is this the case?
What is it about the U.K. -- because after all, if Paris, which is only 200 miles away from London, and Frankfurt, just a few hundred more, what's happening over the U.K.?
GUILLERMO ARDUINO, CNN METEOROLOGIST: It's -- it's the would right now. It's actually, the winds are coming from here, the same direction that we were talking about before with the jet stream, now all levels, we have the same kind of winds. So this area is affected. And it goes into the Low Countries and Scandinavia.
So practically the entire area of Great Britain is being affected by still some concentration of ash. And, also, a proximity issue. The closer you are to Iceland, the thicker the cloud is. When it comes to Central Europe -- because imagine that the map on a globe, not on a flat map like we see it right now. So the proximity of Great Britain to Iceland is greater than what we see in Central Europe. That's why the concentration is higher.
Now, in terms of weather proper, we see now excellent conditions in London. So it would be ideal right now, because the weather is doing nothing. You see we have some rain showers in the northern parts of Scotland and that's about it.
We see some frost maybe in the morning and then the temperatures are going to remain to be very nice, indeed, like 15 degrees or so in London. And in the north it's going to be a little bit cooler. We also see a little bit of rain showers into Amsterdam, but in general terms, the weather is very, very nice.
A system over Spain bringing some clouds and also here into Ukraine, the -- the Black Sea is where we see some nasty weather conditions. But we expect. No problems at all.
I noticed that Germany has many areas with wind advisories. And we see rain showers right now in Ramstein, in Leipzig and in Edinburgh (ph), as well, as I was saying before.
But Vienna with some winds. That's about it. I think that the weather is excellent. And I want to leave with a view of what's going on with the plane action right now.
So you see, Richard, that we have much more volume, we have many more planes right now taking off and operating, even in Germany. We see some here in Britain. I can't confirm that they are commercial planes, but I -- at least, Richard, we see some action here, on the other side of the map, in the Balkan Peninsula, the Alpine Region, Poland, was a lot going on.
Back to New York.
QUEST: We thank you, Guillermo, at the World Weather Center.
We're going to take a short break. But the rumors out of Britain suggest that the planes are on their way back into the U.K. -- at least they're flying toward Britain.
Where will they be able to land tonight and when will they take off again in the morning?
You'll rejoin us in just a second or two.
(COMMERCIAL BREAK)
QUEST: Welcome back, QUEST MEANS BUSINESS.
We're live at Newark Airport tonight.
Planes are starting to fly back to Europe. Lufthansa says that 30 flights will leave the United States and head to Europe. Other airlines, too, are managing to fly. The only ones that, seemingly, from Newark won't be going tonight, LOT Pole -- Lot Polish Airlines have canceled to Warsaw. And, of course, British Airways flights to London Heathrow. The one -- the destination board suggests Virgin may or may not get a flight out tonight.
Paula Newton is at Heathrow Airport, which has now somewhat become the epicenter of what's been taking place -- Paula, what do you make of these reports that there are planes heading to Britain, but where will they land?
NEWTON: B.A. British Airways, telling us, Richard, that 26 long haul flights coming from India, coming from other parts of Asia, coming from the West Coast of the United States are on their way here right now. They say, their language, Richard, now, that we hope there is a window of opportunity to land these 26 planes in either Gatwick or right here at Heathrow some time later this evening. They are being quite vague.
This is obviously unprecedented. They have put upwards of 8,000 people in the air, telling them that they may or may not land in London. They say if they're not given permission to land here, they will land them at the nearest European airport.
But, Richard, I defer to you on this. This is clearly the British Airways putting a lot of pressure on the civil aviation authorities here.
QUEST: Paula, the situation is that the planes may be flying. They will certainly have enough fuel to get to alternate airports. They won't get anywhere near the point of, though, return. And there are other places where they will be able to land.
But the question, of course, and throwing it back to you, becomes these constant deadlines for when U.K. air space is opened, which then never actually happens -- Paula?
NEWTON: We have a new update in about an hour or so. These airports are supposed to stay closed until at least 1:00 in the morning. The point of controversy -- and I'll remind everyone again that we have a special Cobra, which is a security meeting here, by the British government, that just wrapped up about an hour ago -- can they open up a corridor?
And B.A. Perhaps, we're speculating -- is trying to prove something, that they want, they need that air corridor to be opened up, at least for some flights.
But as you say, important to note, they'll have the fuel, they'll go to an alternate European location if they have to.
QUEST: All right, Paula Newton, who is at Heathrow Airport there with the tale of the British Airways jets. And you can bet yourself that we will be following those planes as they come overhead toward London and see where they finally land. Other airports and countries like Germany have gone to visual flight rules via far (ph) to enable planes to land, even though there may be some small presence of ash cloud.
When we come back to Newark in just a moment, a Profitable Moment.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment.
This is Nancy.
Nancy, where are you trying to get to?
NANCY: Brussels.
QUEST: How long have you been trying to get to Brussels?
NANCY: We -- we are waiting from Tuesday.
QUEST: From Tuesday?
NANCY: Tuesday. And we're -- Thursday.
QUEST: Thursday?
NANCY: Yes.
QUEST: Thursday, but all days start to merge after a while. And you're also...
NANCY: I'm pregnant.
QUEST: You're pregnant?
NANCY: Yes. And my little child is waiting for us in Belgium from one week.
QUEST: How are you holding up?
How are you managing?
Are you OK?
NANCY: Yes. Not really, because I'm crying a little bit every day, because it's not easy. We don't have any solution. We don't -- I have paid to -- to go home. We don't know when we can -- we are going to go home.
QUEST: Good luck in getting home tonight.
NANCY: Thank you.
QUEST: Good luck, indeed.
The stories of people that are here at Newark. On the one hand, the planes are flying. But on the other, there are people who have got many more days to wait before they get on board.
And that's QUEST MEANS BUSINESS from Newark Airport for tonight.
I'm Richard Quest reporting.
Whatever you're up to in the hours ahead, I hope it's profitable.
I'll see you tomorrow.
END
